The Real-World Impact Of The Supreme Court’s Campaign Finance Ruling

What is the likely impact, in the real world of politics, of yesterday’s 5-4 Supreme Court decision in McCutcheon v. Federal Election Comm’n, which struck down a federal law that limited the total or “aggregate” amount of money an individual could contribute to candidates and PACs in a federal election cycle? 

Covington & Burling LLP, a highly respected D.C.-based law firm, published a client alert that addresses that very question.  Money quote:

High net worth individuals are now an even more productive source for fundraising. Citizens United v. FEC increased their role in politics, and McCutcheon will accelerate that trend. The difference here is that, unlike with Super PACs, elected politicians are able to request the contributions directly from the high net worth donor. One major effect of today’s decision will be the expansion of Joint Fundraising Committees (JFCs) as a tool. JFCs are created by candidate committees, party committees, and/or PACs to raise money together. They have the advantage of allowing donors to bundle together their contributions to several entities in a single check. The most commonly recognized examples are the presidential JFCs. For example, the JFC “Romney Victory” could accept up to $75,800, with $2,500 going to the Romney campaign’s primary account, $2,500 to the campaign’s general account, $30,800 to the RNC, and the remaining $40,000 to state Republican parties. The “Obama Victory Fund 2012” had a similar contribution formula.

After today’s decision, we expect to see the emergence of large “Super JFCs” that will have many candidate participants. These Super JFCs will be able accept very large contributions in a single check. For high net worth individuals, this means they will be able to write fewer checks than before, but now with much greater impact.

Going forward, we expect today’s decision will increase the political power of Members of Congress who have a strong relationship with high net worth donors. We also expect it to increase the influence of major donors. Congressional leaders, Committee Chairs, and those with similar organizational power in Congress may be able to earn the loyalty of less influential Members by including them in a JFC for which the leader or Chair is soliciting contributions. But it will also allow power to collect around any Member who can command a national or regional base of wealthy donors, such as a prominent Tea Party or environmental advocate.  

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